Sponsorship speech on the proposed 2013 National Budget
Empowerment Budget of 2013: A Bridge of Hope
Senator Franklin M. Drilon

Mr. Senate President, distinguished colleagues, fellow servants in government:

Isang mapagpunyaging araw sa ating lahat.

We are again at a pivotal moment in our nation's history when we assume our constitutional duty to shape the national budget and the national destiny. I stand before you today to present for the approval of this august chamber the proposed national budget for 2013 that will have a direct impact on the lives of an estimated 100 million Filipinos.

2012 can be best described as an annus mirabilis - a wonderful year - for Philippine governance. What bountiful harvest we may reap this year, will comprise our very fiscal and social capital for next year's gains.

Guided by the 2012 General Appropriations Act, the national government implemented key reforms and programs that sought to maximize each and every peso in the public coffers for the best interest of the people.

Prudent and efficient spending has, among others, resulted in high trust and approval ratings for key officials and institutions in government, particularly President Benigno Aquino III and the Senate led by Senate President Juan Ponce Enrile.

The trust that we receive from the people reflects a renewed sense of optimism reverberating throughout the nation. The people's trust and confidence translate to political capital, if not constitutional capital, that can be invested for further reforms in governance where Congress can take lead.

The NEDA, in its August 6, 2012 Senate briefing on the proposed 2013 national budget, highlighted key points in the country's current economic performance and outlook. ln the first quarter of 2012, the Philippine economy grew by 6.4 percent because of renewed business and consumer confidence, improved external trade, and accelerated government spending. Allow me to underscore at this point that our first quarter real GDP growth was above the market consensus forecast of 4.8 percent, as well as Asia's regional average. Global analysts and economists were quick to point to the fact that the Philippines had registered the highest growth among ASEAN and other neighboring countries, save perhaps for China.

Indeed positive developments in our domestic economy have been recognized by 3 major credit rating agencies - Standard and Poor's, Moody's lnvestors Service and Fitch Ratings - and they have made at least 7 positive ratings on the country since June 2010. The rating upgrades were based on the Philippines' sound macroeconomic fundamentals, fiscal consolidation, and improvements in institutional strengths.

Mr. President, the proposed 2013 budget is more than about the national government's expenditures and sources of financing for next year. It is the keystone to good governance in all its many facets -- from basic social services to national security, from inclusive economic growth to peace and the rule of law, from disaster prevention and crisis management to anti-corruption and participatory governance.

Tool for Empowerment

Last July 24, 2012, President Benigno Aquino III submitted to the 15th Congress his administration's proposed P2.006-trillion national budget for 2013, which the lower House approved with revisions on third and final reading on October 15, 2012.

This august Chamber now assumes the task of ensuring that the budget will meet the nation's most urgent needs and that public funds are managed prudently and judiciously.

The President, in his message to Congress, described his proposed 2013 national budget as a tool for people's empowerment. It is a budget that invests significantly in the people's capabilities by prioritizing funding for public services that provide jobs, educate the youth, ensure a healthier citizenry, and empower each Filipino to participate in nation building.

The President's Budget is anchored on a real GDP growth rate of 6.0 to 7.0 percent, inflation rate of 3.0 to 5.0 percent, and the 364-day T-Bill rate also at 3.0 to 5.0 percent. The exchange rate is projected at P42 to P45 against the dollar, while crude oil prices are projected in the neighborhood of US$90 to $110 in 2012 as well as 2013.

For 2013, the national government plans to further trim the fiscal deficit to just 2 percent of GDP. To support the 2013 budget, the government will raise total revenues of P1.78 trillion. It also projects a 13.8 percent tax effort, up from an expected 13.3 percent in 2012. The government's total outstanding debt in 2013 will amount to P5.8 trillion or less than half of the GDP compared to a 54.8 percent debt to GDP ratio in 2009.

Slicing the Budget Pie

In its proposal, the Palace submitted to Congress for review and approval Total New Appropriations of P1,368.329 Billion. With Automatic Appropriations of P755.219 billion less the Unprogrammed Fund of P117.548 billion, Total Obligations will amount to P2.006 trillion.

The biggest share of 34.8 percent in the 2013 national budget will go to social services, while economic services is second with 25.5 percent. On the other hand, the share of our debt-servicing burden will fall to 16.6 percent next year from 18.3 percent in 2012. General public services will have a 17.3 percent share while defense will get 4.5 percent.

Mr. President, our people's education will continue to be the government's top priority in the 2013 budget, as mandated by our Constitution. Thus the Department of Education will remain as the agency with the highest budget allocation. Its budget will increase by 22.6 percent to P292.7 billion, from P238.8 billion this year. A P54 billion increase in funding will help address shortages in education resources such as classrooms, teachers and textbooks. It will also support the department's K+12 program.

The DPWH is second with P152.9 billion, followed by the Department of National Defense (P121.6 billion), DILG (P121.1 billion), DA (P74.1 billion), DOH (P56.8 billion), DSWD (P56.2 billion), DOTC (P37.1 billion), DOF (P33.2 billion), and the DENR (P23.7 billion).

Mr. President, the Corporate Operating Budgets of the National Electrification Administration (NEA), the National Power Corporation (NPC), and the Philippine National Oil Company (PNOC) have also been submitted to Congress for approval, pursuant to Section 13, Chapter III of R.A. No. 7638 or the Department of Energy Act of 1992.

Through the Legislative Mill

At this juncture, Mr. President, allow me to state that no major amendments were introduced in the House-approved General Appropriations Bill. While the said bill does not include the Priority Social and Economic Project Fund, a lump-sum fund newly created in the President's Budget, the specific programs, projects and activities contained therein have been transferred back to the relevant implementing agencies. This the DBM itself requested from Congress upon the concerned agencies' submission of the detailed breakdown of their specific allocations.

In the exercise of our Constitutionally-mandated power of the purse, your Committee on Finance, Mr. President, has performed its task of scrutinizing the proposed national budget with a fine tooth comb through the recently-concluded round of budget hearings and technical working group meetings.

As proposed by your committee, Mr. President, Programmed Funds will be maintained at the House bill level amounting to P1,250,780,785,000.00. With Unprogrammed Funds remaining the same at P117,548,371,000.00, Total New Appropriations will amount to P1,368,329,156,000.00.

Incremental funds will be provided to the Bureau of Immigration for the purchase of five (5) passport reading machines, as well as additional funds for repairs and maintenance for the Anti-Money Laundering Program. The budget of the Southern Philippines Development Authority (SPDA), on the other hand, will be reduced by P27.500 million in MOOE. Likewise, there shall be realignments within selected agencies to reflect their actual needs and priorities. Within the Supreme Court of the Philippines, for instance, P1 million will be realigned from MOOE to Capital Outlays to provide for a line item for the construction of the Manila Hall of Justice which could be augmented from their savings. Similarly, P500 thousand will be realigned within the Commission on Elections to provide for purchase of land and construction of building to serve as a warehouse for PCOS machines. Under the Unprogrammed Fund, P23.4 billion will be realigned for the Universal Health Care Program, which shall be subject to the incremental revenue from the enactment of the law restructuring the excise tax on alcohol and tobacco products. Mr. President, the highlights of the amendments on Special and General Provisions are as follows:

• Inclusion of "pre-disaster activities" in the utilization of the Quick Response Fund under the Department of National Defense-Office of the Secretary and the Office of the Civil Defense. As of now, the Quick Response Fund is utilized only as a standby fund for relief, rehabilitation and reconstruction projects.

• Deletion of the Special Provision on "Funding Requirements for the filling of Unfilled Positions" which violates the provision on fiscal autonomy of Constitutional Offices including the Judiciary, all of which are allowed by the Constitution to use their savings in any item of their respective appropriations.

• Inclusion of national roads and bridges, as well as school buildings among the infrastructure projects that may be funded under the hard allocation of the Priority Development Assistance Fund.

• Amendment on the Use and Disbursement of Internal Revenue Allotment of LGUs, in particular, requiring them to post their utilization of the local disaster risk reduction and management fund in three (3) publicly accessible and conspicuous place.

• New special provision under the Philippine Council for Agriculture, Aquatic and Natural Resources Research and Development earmarking P40 million for research projects on algae research and commercialization, precision farming, and smart agriculture.

• New special provision under the Philippine Council for Industry Energy Research and Emerging Technology Research and Development earmarking another P40 million for research projects on disaster science and management, and responsible mining technologies.

• New special provision under the Public-Private Partnership Center of the Philippines providing P630 million to augment the Project Development and Monitoring Facility (PDMF), and another new provision stating that in addition to their appropriations, the PDMF fund, which is structured and to be managed and administered as a revolving fund, will have reimbursements of technical assistance fees directly from the winning bidder of the PPP project or from the implementing agencies.

• New special provision under the E-Government Fund on the Funding for the Innovation Clusters, earmarking P50 million for research projects and activities for cloud computing and software-as-a service.

• New special provision under the Unprogrammed Fund on the Universal Health Care Program amounting to P23.4 billion to cover the Philhealth premium of workers in the informal sector, health facilities enhancement program, preventive and promotive health programs, and policy and regulation standard, subject to the incremental revenue from the enactment of the law restructuring the excise tax on alcohol and tobacco products.

• Deletion of the General Provision on the Allocation for Autonomous Region in Muslim Mindanao in Nationwide Projects which required that all national government projects requested by the Representative of the Congressional District shall be implemented by the ARMM Regional Government.

• The committee is supporting the House proposal under the General Provisions specifying that authorized deductions from an employee's salary, emoluments or other benefits shall in no case reduce the employee's monthly net take home pay to an amount lower than Five Thousand Pesos (P5,000).

Bridge of Hope

Mr. President, distinguished colleagues.

Crafting a national budget within the cool, thickly-carpeted confines of our august chamber may seem like a mere accounting exercise on balancing needs against resources. And yet it is more than that. So much more, I dare say.

A peso allotted for education would bring a glimmer of hope in Nenita's eyes as she walks some three kilometers to school every day, somewhere in the hinterlands of Mindoro. Funds earmarked for health would alleviate the pain borne by Aling Chayong, who would rather buy food for her children than life-saving medicine for her ailment. Allocation for housing and livelihood would brighten the desolate world of Mang Pepe who sits by the window, weaving dreams of hope in a tottering shanty in a backwater Manila community.

Mr. President, my dear colleagues, let not cold statistics but warm bodies guide our decisions and priorities in this budget. Let us not forget that these numbers pertain to real, flesh-and-blood Filipinos whose empowerment, through deliverance from backbreaking poverty, will ultimately shape the destiny of our nation.

Indeed, "Empowerment" is what this budget is all about. Together let us stamp our legislative imprimatur, not on a mere financial blueprint for our economy but on a "Bridge of Hope" for our people ... a budget that paves the way to a future where dreams do come true for little Nenitas.

Mabuhay tayong lahat! Mabuhay ang Pilipino!

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